State's Hospitals Not Catching Billing Break

Hospitals everywhere struggle with uncompensated care — both uncollectible bills and charity cases the hospital never expects will pay.

The Affordable Care Act is supposed to help lessen that financial burden. And nationwide, it's happening, says the U.S. Department of Health and Human Services.

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But that's not the case in Connecticut, hospital officials here say.

Across the country, Obamacare has reduced the number of uninsured by making some insurance less costly, and has expanded the number of people eligible for Medicaid, the government insurance for the poor.

But according to the Connecticut Office of Health Care Access, two-thirds of the uncompensated care in Connecticut is from bad debt — people who simply do not pay — rather than from treating the poor. Thus, more insurance availability has not necessarily meant more compensation for hospitals.

Also, Medicaid typically pays hospitals less than the actual cost of care — a downside of increasing eligibility for the program, as our state has done.

Another problem faced by hospitals here has little to do with the Affordable Care Act: a 2011 scheme to tax hospitals, then redistribute the money back to the hospitals so they may qualify for federal funds.

At first, the plan worked in the hospitals' favor. They paid $350 million a year in taxes and got about $400 million back.

But the state has changed the rules, vastly reducing the amount hospitals are paid back, leaving them further in the red. The annual payback has shrunk to $95 million, says the Connecticut Hospital Association.

Our state has been a leader in making health care both available and affordable. We should be on the receiving end of the benefits of Obamacare — as we may be eventually, says the Office of Health Care Access.

In the meantime, the state should drop, or at least adjust, the hospital tax-and-pay plan. Hospitals should be fairly compensated for the care they provide.